Just when the textile bosses lamented that the market was not satisfactory, a chemical fiber variety bucked the trend and rose by 28.3% in 2 months! !
It is spandex! As a “condiment” for bulk textile raw materials, spandex yarn is generally used in elastic fabrics with other chemical fiber products in a certain proportion!
According to the price monitoring of China Silk City Network, the domestic spandex market price has been rising since October. As of November On the 17th, the ex-factory price of 40D was 36,000-40,000 yuan/ton, which was an increase of 28.3% compared with the average price of 30,000 yuan/ton in early October.
Spandex manufacturers have also issued multiple price increase notices. The manufacturers’ early backlog of inventory has gradually been cleared, and the inventory has also dropped to historical lows. Some batch numbers even have tight supply, and supply is tight! A textile boss who makes four-way elastic said: “Recently, spandex has been rising like crazy, and the key is to queue up to get it!” The main reason for the surge in spandex prices this time is the rise in the cost of upstream raw materials, which has boosted the price of spandex. !
On the other hand, polyester filament, the main force in bulk textile raw materials, has been a bit lonely recently! Even if good news comes one after another from the macro perspective, it will be difficult to boost the market.
On the evening of November 16, the American biotechnology company Moderna announced that its COVID-19 vaccine, mRNA-1273, is 94.5% effective and plans to use it in the future. Apply for emergency use authorization for the new coronavirus vaccine in the United States within weeks.
This is undoubtedly another big benefit, but after this “stimulant” was injected into the textile market, there was not much splash. International oil prices rose for a time and then fell again, which has a modest boost to the polyester market!
In fact, we have experienced the epidemic situation last week. Brent was pushed up to 45.3 US dollars, and polyester production and sales also ushered in the “two-day tour” market. The production and sales of manufacturers once rose to 600%, and the price of polyester filament was partially raised by 50-100 yuan/ton. However, the good times did not last long. After a short period of stimulation, the market returned to rationality. It can be seen that there is still great uncertainty in the raw material market.
There have been many macro events recently, such as the US election, significant vaccine progress, and the signing of RCEP. These events have more or less affected the textile market. However, when it comes to the polyester filament end, the price has not been well followed up. Recently, the price of polyester filament has even dropped in price and expanded discounts.
It’s all the fault of “money”, the boss is prepared or not Wander!
Since November, the new coronavirus outbreak has erupted globally for the second time, and orders in the foreign trade market have become even tighter. “Recently, it feels like all the customers around me have disappeared. Customers from Japan and South Korea placed orders in October, but there have been no new orders recently.” Mr. Shen, who is engaged in fabric trading, said.
Orders in overseas markets, especially in European countries, are not as expected as expected, causing headaches for many foreign trade bosses. What is even more worrying is the cancellation of orders that have been placed.
“Recently, we have had orders canceled one after another, and the total order value is already around 1 million yuan.” said a textile boss who makes functional fabrics. In addition, some textile bosses said that 30% of the orders they had just negotiated were canceled the next day; there were also orders that had been delivered one after another, but were stopped midway.
The sales volume has recovered by only 60-70%, which has become a true portrayal of many textile companies this year. At present, the foreign trade market has not developed well, and the domestic trade market alone has “one leg” “Walking” is still relatively difficult, especially in terms of funds, and textile bosses also have a lot of worries. “This year’s payment collection time is longer than in previous years. In the past, old customers could pay for goods within one month, but now it has to be delayed to two months or even longer.” said Mr. Wang, who specializes in imitation silk.
According to research, the current payment collection cycle of most textile companies is generally 3 months or more, which is 1-2 months longer than in previous years.
“It will be harder to get money for the Chinese New Year this year than in previous years! The price of raw materials is quite low now, and the price is quite exciting, but a lot of our money is in the payment for goods. How much money can we get back? We just have as much stock as we can prepare!” said another textile factory owner in Anhui.
It can be seen that funds and order status have become the key to fettering textile bosses!
Multiple benefits have come together, and new expectations for demand recovery have been formed!
The reason why the market is so powerless is mainly because of the global outbreak of the new coronavirus epidemic, which has once again dragged down consumers’ desire to consume.
However, now that the global COVID-19 epidemic is in sight due to the development of a vaccine, new expectations for demand recovery have been formed. Many experts predict that China’s economy will return to normal track in 2021 and may It is one of the major economies with the highest growth rate. China’s economic growth is expected to reach 8.9% in 2021, and commodities are also expected to usher in a new round of bull market in 2021.
However, with optimism about next year, it will take time for these positive macro news to be digested by the market. The results of the US election are still going back and forth, and the vaccine will not be widely available until next year at the earliest. The signing of the RCEP agreement is just a starting point, and it will still take some time before RCEP finally takes effect…
Because of this, the current textile market can be said to be experiencing “darkness before dawn.” However, from an economic point of view, the market has always been cyclical. Now after a long period of downturn, the market can easily rebound.
According to recent data released by the National Bureau of Statistics, industrial data continued to maintain a high rate in October this year. In October, the number of industries above designated size increased by 6.9% year-on-year, which was higher than the same period last year. 2.2 percentage points, which is also higher than the market consensus of 6.5%. In addition, the growth rate of industrial added value in textile, rubber, food, machinery and other industries has accelerated significantly from the previous month, and exports have been significantly boosted.
It is worth noting that from a macro perspective, demand will further recover in the future. On the one hand, as the domestic temperature drops precipitously, the cold air will completely reverse the current warmer trend, and the market demand for cold-proof clothing lining fabrics shows signs of further growth. On the other hand, according to consumption habits, domestic consumption will continue to increase in the future. There is still a lot of room for recovery under the stimulation of sales seasons such as Double 12, New Year’s Day, and Spring Festival.
Taken together, good macro news is coming one after another in the market. Although it cannot “ignite” the market quickly, it also provides a strong force for the market to bottom out and rebound in 2021. of support. The sun always comes after the storm, and textile bosses have to go through the darkness before them, and next year there will always be a new round of spring and flowers blooming! For manufacturers with low raw material inventories, you can consider stocking up on appropriate quantities to prepare for next year!
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